Business-school research: Failure to launch

IT CAN be surprisingly hard to tell when an organisation has failed. Businesses have products that never quite got off the ground, investments with ugly returns and once-promising managers languishing ineffectively for years. But when outside observers, including well-intentioned researchers, come calling, companies are not in a hurry to talk about it.

Peter Madsen, of Brigham Young University in Utah, and Vinit Desai, of the University of Colorado at Denver, ran into this problem while trying to investigate how organisations learn from both successful and failed ventures, and how that knowledge is retained over time. Their solution was to examine firms, private and public, that launch rockets designed to place satellites into orbit around the Earth. As the authors explain in a recently-published paper in the Academy of Management Journal, when a satellite fails it is easily identifiable (either the rocket makes into space, or it doesn't); costly; and “often very loud”.

Moreover, the pair were able to take a large sample: all orbital launch attempts between October 1957 (the deployment of the first Sputnik) and March 2004. They wanted to see how, for any given company, its successes or failures, and those of its rivals, influenced its ability to get subsequent rockets into space. The authors also wanted to measure whether success depended on how long had passed since the previous launch. This, they hoped, would measure of whether the company was retaining the lessons that needed to be learned.

They found that failed launches reduced the risk of future problems more than successful ones. What is more, the knowledge acquired after successful launches also seemed to be lost more rapidly than after failures. The effects of learning from other orbital-launch companies' successes and failures were smaller, but similar. In sum, a bad launch proved a better teacher. (Although as mergers or political disruption can interrupt this learning process the authors had to adjust their calculations to account for the fall of the Soviet Union and the resulting shakeup of satellite-launching agencies.)

The professors are understandably reluctant to recommend messing up as a learning tool. “Managers don't need to go out and seek failure, necessarily,” says Mr Madsen. Instead he suggests trying to extract lessons from smaller, less costly mistakes. Companies stand a better chance of being able to learn, even in the absence of disaster, if they can show greater flexibility towards meeting set goals. Focusing too tightly on certain deadlines or profit margins give workers an incentive to overlook or explain away failures. An organisational culture that holds managers accountable for identifying, and seeking lessons from, small failures can also help.

Unfortunately culture can get in the way of learning, as Messrs Desai and Madsen acknowledge in pointing to American space exploration. In 2002 NASA, having recovered (and learned) from the loss of the Challenger space shuttle, saw a launch marred by a small piece of foam breaking free and striking the shuttle. That was the Atlantis, which returned safely and was considered a success. The next shuttle to lose a piece of foam was the Columbia, a fatal failure.

Its an age old saying repeated in a new research, 'Experience is the name given to your past mistakes'! One hardly analyses success & moreover fear of credits also takes away the charm in a team effort.

Failure to launch is the stepping stone to future success, is true in that we learn far more from our mistakes, than our wins. Then again, success breeds success far more than failure, is also a paradigm that has not shifted much, down the ages.

So in the end, we learn form our mistakes & take advantage our successes to create a win win situation, either way.

1) Failures leave a bad taste and hence, people and organisations dont wish to remember them... and lose the opportunity of learning from mistakes.

2) Culture of letting make mistakes is important. Learning is proportionate to the level of mistakes an individual can make in any organisation.

We can avoid both these traps and still have higher learning curve. The trick lies is being more alert and open to learning from others' mistakes. Engaging with other individuals, groups and organisations can be the best way of learning from each other's mistakes. A collective execution of a single project by two or more organisations is another way of enhanced learning due to varied organisational perspectives, and reduced risk of loss because of pooling of resources by this bunch of organisations.

There is a counter point: you can only learn better when you feel the pinch first hand. But that is all about priming our minds. We need to get smarter and start gaining from others' actions and consequences. Since every resource is limited we better utilize them optimally. "The challenge is in producing more by inputting less".

I have always said I learn by making mistakes. If you do everything right the first time, there is little feedback, and it is chance whether you next experience works out well. What is important for young people is to start in a safe environment, where mistakes are not fatal. That is actually harder in the modern world.

The other day I was in Lowe's. The guy in charge of the dept., who knew about weed eaters, was answering questions of two ladies about some mowers... It went on, and on, and on, and on..

Finally a lady comes by with the uniform of Lowe's and ask me "How can I help you".. I did not think she could help me so I asked her: "Do you know about parts for a Husquavarna weed eater?".. Naturally the answer was "no"..

She points to the guy talking to the ladies "he knows".. "Yes, but he has been in never ending questions and answer with those ladies like if he were a decorator of their house"..

""You guys need training: You should tell the ladies and those that do not know what the want or need "Please, be specific: What is exactly your problem? and then point the tool or part to solve it"

The lady told me "but they have to answer their questions"...
I told her: you guys want to stay back obviously... You guys resist good advise.. change.. "You will be going down, just like GM"..

Learning from ones own mistake is natural,How one then rectify it next time is what differs?But the best you learn from the mistakes of others. It saves you time,resources etc. Organisations need to be flexible not lenient with mistakes. If u left people only to themselves,n allow them to commit mistakes,it will create confusion n chaos. A better woven culture is what is required.

This is interesting and valuable research and we should apply the findings to the biggest problem we face today. That is pending economic and ecosystem collapse. The logic that this will be the outcome if we continue with business as usual is hard to dispute. But we seem to be determined to experience failure before we will learn.

The research found that failed launches reduced the risk of future problems more than successful ones. In sum, a bad launch proved a better teacher. For one satellite it is a big bill picked up by the insurance company; for our planet this is a learning experience we can ill afford.

Learning from mistakes requires the maturity of mind to face facts abd accept them. The culture in organisations, on the other hand, is to appropriate credit for work done by others, and apportion blame for failures on to others. This is not conducive to learning, but only to sweep the dirt under the carpet, along with its nuggets of wisdom